Inside:Knowledge Partner to Ministry of Shipping, Government of India.......................2

PPP transaction for redevelopment of railway station.........6

Annual Fiduciary Review for the Third Primary Education Development Project (2014 and 2015).......................8

Supporting good governance in Chhattisgarh....................4

Dear readers,

I am pleased to bring to you the eighth edition of Signpost, EY’s newsletter on the Government sector and how we are supporting it in its initiatives.

This newsletter illustrates our range of service offerings across the Government sector and clients in the Indian sub-continent. In this edition, we highlight EY’s support and interventions across four engagements.

EY were the Knowledge Partners to the Ministry of Shipping, the Government of India for organizing the maiden flagship Summit, Maritime India Summit 2016. EY’s sector knowledge, program management approach, ability to co-ordinate with multiple stakeholders, creation of a comprehensive shelf of projects and managing a comprehensive program plan on multitude of activities made the summit a grand success, inviting investments to the tune of INR83,000 crores for the 140 projects showcased at the event.

The second project highlighted here is in the state of Chhattisgarh where EY has been advising The Chhattisgarh Infotech Promotion Society (CHiPS) — the information technology nerve centre for the state of Chhattisgarh. CHiPS is responsible for planning and implementing e-governance and IT initiatives across the state including the Chief Minister’s (CM) Dashboard that assists in the performance of government projects and initiatives. The dashboard developed by EY has introduced a data-driven approach to governance in the state. Periodic performance reviews by the Hon’ble CM are no longer sessions where data is presented but discussions are held around strategies to improve performance and achieve targets. There has been a consistency in the form of data being presented and enhancement in accountability, accessibility and transparency in the functioning of all departments of the state.

In 2012, the Ministry of Railways undertook an initiative for modernization of railway stations through development/redevelopment of 13 stations along with maintenance of all these stations across

India. The Indian Railway Station Development Corporation (IRSDC) has engaged EY as transaction advisors for redevelopment of four railway stations for example, Habibganj (Bhopal), Bijwasan (Delhi), Chandigarh and Shivajinagar (Pune) under public private partnership (PPP) mode — a first-of-its kind initiatives in India. EY was faced with a key challenge to develop a model, which could achieve synergy between two different project components, i.e., station operations and real estate development. The results have been encouraging as the railway station at Habibganj (Bhopal) with a total project cost of approximately INR450 crore has been successfully awarded to a private sector player and will be redeveloped over a period of three years. Similarly, development of a greenfield railway station at Bijwasan (Delhi) is in advanced stages and Chandigarh and Shivajinagar (Pune) railway station projects are also underway.

The last project highlighted in this edition is from Bangladesh. The Government of Bangladesh (GoB) and nine development partners signed a Joint Financing Arrangement (JFA) to support institutional reforms and improved educational outcomes in the primary education sector as described in the Third Primary Education Development Program (PEDP3) Program Document. EY has been engaged by the Asian Development Bank (ADB) on behalf of all development partners for an Annual Fiduciary Review (AFR) for the Third Primary Education Development Project (2014 and 2015). Phase-1 of the assignment was successfully closed and the EY recommendations are being disseminated by the respective agencies across Bangladesh.

Please continue to share your feedback and ideas with me at gaurav.taneja@in.ey.com. I look forward to hearing from you

Kind regards Gaurav Taneja India Government and Public Sector Leader

SignpostEY Newsletter for Government and Public Sector

October 2016

2Signpost, EY newsletter for the Government and Public Sector

Overview and challengesMaritime India Summit, being the maiden flagship summit of the Ministry of Shipping, had to be organized as a benchmark summit, which will serve as an example to all ministries of the Government of India.

The maritime sector is one of the significant contributors to the country’s gross domestic product (GDP); however, never before was it accorded the requisite prominence. The Ministry of Shipping and EY were faced with a major challenge of coordinating with multiple stakeholders ranging from shipyards to logistics companies to barge operators to C&F agents. The EY team sought inputs and feedback from more than 500 stakeholders across ports, shipping lines, private operators and service providers, finalizing the investment opportunities across the vast maritime sector in India and creating a shelf of investible projects. This involved regular follow-up with 18 administrative agencies. The first-of-its-kind initiative by a Union Ministry, the investor outreach phase involved creating a database of prospective investors from across the globe, and this had to be done from scratch.

The EY team was required to facilitate efforts of the Ministry of Shipping to adopt leading policy practices to turn-around the sector, attract institutional investors for funding, preparation of marketing collaterals and investment catalogue, content development for participation brochures, preparation and circulation of newsletter and assist in signing of investment/business agreements with investors/stakeholders/ strategic partners (institutions, companies, government entities).

Support and interventionEY played a vital role in identifying investible projects for the maritime sector in India that was showcased to the investor community.

The EY team worked closely with Ministry officials in identifying projects under the Sagarmala National Perspective Plan that is included as one of the projects.

This included 52 projects aimed at modernizing existing 12 major ports, infrastructure upgrade in 117 National waterways, 6 new mega ports, 70+ port connectivity projects and 27 coastal economic zones/industrial clusters.

Maritime India Summit was the maiden flagship summit of Ministry of Shipping. Organizing this summit involved an arduous co-ordination effort with industry associations, 12 major ports, 13 states and union territories, 17 agencies/organizations under the Ministry of Shipping. It entailed understanding the investment needs and requirements of the maritime sector. EY’s sector knowledge, program management approach, ability to co-ordinate with multiple stakeholders, creation of a comprehensive shelf of projects and managing a program plan on the multitude of activities helped organize a successful Maritime India Summit 2016.

Knowledge Partner to Ministry of Shipping, Government of India

3 Signpost, EY newsletter for the Government and Public Sector

The EY team created insights for 10 sub-sectors on various aspects of development of the maritime sector including port-led development, shipbuilding and ship repair, coastal shipping and inland water transportation, hinterland connectivity and multi-modal logistics, maritime tourism and renewable energy in ports and shipping. These insights included identified leading practices (regulatory and policy framework, incentives mechanism, government support, etc.) from across the world and customization in the Indian context. The rich content helped in focussed and forward-looking discussions in the technical sessions during the Summit.

Our team’s ability to provide deep domain knowledge, co-ordinating with multiple stakeholders including the Prime Minister’s Office and Ministry of Shipping helped the client organize a successful summit, which has now become a benchmark event for other ministries in the Government of India.

Result and ImpactMore than 140 business agreements were concluded during the Summit. The value of investments in 140 projects is estimated at INR83,000 crores. The Ministry of Shipping also showcased around 240 projects with investment potential of around INR4.34 lakh crores. The summit provided a platform for participation, engagement and interaction from across 42 countries. More than 5,000 delegates and 197 exhibitors including 81 international companies, 80 Indian private sector companies and 36 government-owned entities graced the Summit.

“I congratulate Adil Zaidi and the team on the successful conduct of the maiden Maritime India Summit-2016 at Mumbai during April 14-16, 2016. I convey my appreciation for your sincere efforts and contribution in making this event a success.”

Nitin Gadkari I Hon’ble Minister Ministry of Road Transport Highways & Shipping Government of India

“The engagement by EY team, led by Adil Zaidi, worked closely with us and displayed high level

of professionalism. The team worked very diligently and has put in commendable efforts

in assisting the Ministry on various matters in organising the Summit successfully.”

Abhishek Chandra I Deputy Secretary Ministry of Shipping,Government of India

EY’s Economic Development Advisory (EDA) services focus on policy and regulatory advisory, investment and trade promotion, sector and regional promotion and program management for clients. EDA advises governments on Ease of Doing Business initiatives and reforms, simplification of approvals and procedures.

For more details contact:

Adil Zaidi Partner- Economic Development Advisory (EDA), Transaction Advisory Services, EY Tel: +91 11 6623 3230 Email: adil.zaidi@in.ey.com

4Signpost, EY newsletter for the Government and Public Sector

Overview and challengesThe Chief Minister’s office was facing a challenge in accessing fact-based, concise and insightful performance data of various departments and schemes from across the state. This made the timely inspection and periodic reviews by the Chief Minister (CM) and his team on the state’s progress difficult and time consuming. There was also a need for an information-driven mechanism to better allocate resources and budgetary support in the delivery of services to citizens.

Support and interventionEY is engaged by the Government of Chattisgarh for this project at two broad levels:

• ► Function as an independent think tank to provide advisory inputs on state governance policies, cabinet ministry guidelines/notes and departments/schemes.

• ► Help develop a dashboard, which captures and presents to the CM, key performance indicators (KPIs) of state departments, schemes and districts. Performance against these KPIs is reviewed by the CM and the Secretariat to bring institutionalized and continuous improvement in the state’s governance capabilities.

The EY team has structured the CM Dashboard broadly into three components:

• State at a glance: A single screen view to understand the state’s standing compared to others on key social, economic, infrastructural and demographic parameters.

• Department view: For depicting performance of key departments against identified KPIs and highlighting KPIs, which need attention.

• District scorecard: This is to monitor and track performance of districts against KPIs in key sectors such as health care, education and agriculture. This allows for comparisons between the districts at an individual KPI level and ranks them on the basis of their performance in key sectors, thereby, creating healthy competition among district collectors.

The Chhattisgarh Infotech Promotion Society (CHiPS) is the information technology nerve centre for the state of Chhattisgarh, responsible for the e-governance and IT initiatives across the state. EY is assisting CHiPS in many critical initiatives including the Chief Minister’s (CM) Dashboard and providing Advisory Services to the CM’s Secretariat.

Supporting good governance in Chhattisgarh

5 Signpost, EY newsletter for the Government and Public Sector

The dashboard, besides highlighting what is working well and what needs attention, allows for drill-down, spatio-temporal analysis to identify the possible causes of lagging performance. This then forms the basis for the advisory team to recommend specific strategies for improvement.

The EY on-site advisory team works with the CM’s Secretariat to set time-bound improvement targets and guide the departments on strategies to achieve them. Progress against these defined goals is then monitored on a regular basis by the CM. This team also provides inputs to the CM’s Secretariat on a variety of policy matters and pro-actively suggests interventions and programs for inclusive growth to make a real difference in the lives of the people.

A total of 216 KPIs are used to monitor the performance of 9 departments and 9 State Schemes in the 27 districts.

Result and ImpactThe dashboard has introduced a data-driven approach to governance in the state. It has brought in data consistency and uniformity across the state and is no longer a matter of discussion whether the data is accurate or updated. Periodic performance reviews by the CM are no longer sessions where data is presented — the discussion revolves only around strategies to improve performance and achieve targets.

When drought was imminent in May 2016, the dashboard formed the basis for drawing up mitigation strategies by the state with the help of the advisory team of EY.

Several programs for upliftment of the disadvantaged sections of society have been created by the team, using analysis of the data available through the dashboard.

“It’s an administrative innovation that has helped in transformative decision making.”

Aman Singh Principal Secretary to Chief Minister, Chhattisgarh Government of Chhattisgarh

EY’s Performance Improvement Advisory Services helps government clients to improve performance across a range of areas including infrastructural, social and economic by using technology tools for monitoring and analyzing key performance metrics and recommending appropriate interventions and strategies.

For more details contact:

Vineet Chhatwal Partner- Advisory Services, EY Tel: +91 124 671 4950 Email: vineet.chhatwal@in.ey.com

6Signpost, EY newsletter for the Government and Public Sector

Overview and challengesThe Ministry of Railways undertook an initiative in 2012 for modernization of railway stations and a formal Memorandum of Understanding (MoU) was signed between Ircon International Limited and Rail Land Development Authority (RLDA) to set up Indian Railway Station Development Corporation (IRSDC). IRSDC will act as a nodal agency to take up work of redevelopment of 13 stations along with station maintenance across India.

IRSDC appointed EY as Transaction Advisors for redevelopment of four railway stations namely, Habibganj (Bhopal), Bijwasan (Delhi), Chandigarh and Shivajinagar (Pune) under the public private partnership (PPP) mode. The station redevelopment through PPP was among first-of-its kind initiatives in India and key challenge was to develop an attractive model, which can achieve synergy between two different project components, i.e.,

• ► Station operations component

• ► Real estate development component

While establishing such synergies it was also important that the model attracted private sector participation. The real estate development component was to be utilized toward commercial development. Furthermore, land being a state subject, IRSDC also faced several challenges in coordination with the state government and zonal railways.

Support and interventionEY played a vital role in resolving matters among IRSDC, state government and zonal railways by interacting with various stake holders. EY’s PPP Transaction Advisory Services team advised the IRSDC on structuring projects, bid documentation, bid process management and stakeholder coordination between the Central Government, State Government and the private sector. EY facilitated preparation of a of detailed financial appraisal report to establish the feasibility of all the four railway station projects. Furthermore, intensive project marketing activities were undertaken leading to successful closure of first of its kind PPP transaction.

Modernization of railway stations through development/redevelopment has been a focus area for Ministry of Railways in India to increase non-fare revenue. EY helped the Indian Railway Station Development Corporation Limited in a first of its kind initiative to successfully appoint a private sector partner for redevelopment and station maintenance of the Habibganj (Bhopal) railway station. Concurrently development work of greenfield railway station at Bijwasan (Delhi) is in advance stages and in progress for Chandigarh and Shivajinagar (Pune) railway station projects.

PPP transaction for redevelopment of railway station

7 Signpost, EY newsletter for the Government and Public Sector

The concession agreement was signed in the presence of Union Minister of Railways, Minister of State for Railways, Chairman Railway Board, representatives of Zonal railways and leading private sector developers.

Result and ImpactThe railway station at Habibganj, with a total project cost of approximately INR450 crore has been awarded to the consortium of Bansal Construction Works and Prakash Asphalting and Toll Highways in July 2016. The railway station will be redeveloped over a period of three years. Modern world class passenger amenities such as escalators, lifts, parking lot, landscaping, concourse, walkway, parcel corridor, subways will be provided as part of the redevelopment of the station. Besides, the station will also have a food plaza, medical clinics, office complex, salon and other facilities to generate revenue for the railways. Similarly, development of a new railway station at Bijwasan (as a greenfield project) is in advanced stages. Chandigarh and Shivajinagar railway station projects are also currently underway.

“I got an opportunity to work with EY team on an important project i.e. redevelopment of four railway stations on Indian Railway network on PPP mode. The project concept is first of its kind in India. EY team has associated with IRSDC since April 2013 for the project. During the entire tenure, EY team demonstrated a strong and effective control over the project. Their professional, analytical and timely approach to the delivery has been deeply appreciated.”

Parag Verma Chief Operating Officer Indian Railway Station Development Corporation Ltd

EY’s Public Private Partnership (PPP) services focus on development of infrastructure and provisioning of related services through the participation of the private sector. It aims to facilitate development of efficient assets and effective service delivery systems by leveraging the potential of the private sector. As part of our service offerings, we advise government bodies on designing relevant projects, performing technical and financial viability studies, structuring and implementing optimal risk-sharing mechanisms, and putting in place bid process management systems to select private players. For more details contact:

Abhaya Krishna Agarwal Partner- Public Private Partnership (PPP), Transaction Advisory Services, EY Tel: +91 11 43633060 Email: abhaya.agarwal@in.ey.com

8Signpost, EY newsletter for the Government and Public Sector

Overview and challengesThe Government of Bangladesh (GoB) and nine development partners have signed a Joint Financing Arrangement (JFA) to support institutional reforms and improved educational outcomes in the primary education sector as described in the Third Primary Education Development Program (PEDP3) Program Document.

An Annual Fiduciary Review (AFR) for the Third Primary Education Development Project (2014 and 2015) was to analyze areas of substantial fiduciary concerns and to gradually improve the systems and processes by implementing the concrete recommendations of AFR.

The Government faced several challenges and issues in monitoring the activities of the project due to lack of automation. One of the key challenges was to implement the program and undertake field visits across the length and breadth of Bangladesh.

Support and interventionAsian Development Bank (ADB) engaged EY on behalf of all development partners for this assignment. EY played a vital role in planning the assignment along with ADB to ensure smooth execution of the project. Since there were several stakeholders involved, aligning the requirements of all stakeholders and ensuring achievement of the objectives of the project was critical. Consensus was built among the stakeholders with respect to the procedures to be undertaken by EY for execution of the assignment. The procedures for field visit were standardized and approved by all the stakeholders to ensure involvement as well as acceptance of results. The findings were reported through a collaborative approach involving all stakeholders.

The Government of Bangladesh (GoB) and nine development partners have signed a Joint Financing Arrangement (JFA) to support institutional reforms and improved educational outcomes in the primary education sector as described in the Third Primary Education Development Program (PEDP3) Program Document. Conducting an effective large scale Annual Fiduciary Review (AFR) at the Ministry of Primary & Mass Education program spread across Bangladesh was a challenge for development partners as the consultant was required to have a deep understanding of the local culture for executing the work without any conflicts. EY’s methodology and reach enabled the Development Partners to cover maximum area as well as have effective monitoring of results.

Annual Fiduciary Review for the Third Primary Education Development Project (2014 and 2015)

9 Signpost, EY newsletter for the Government and Public Sector

Result and ImpactPhase – 1 of the assignment has been successfully closed and the recommendations made by EY are being disseminated by the respective agencies across Bangladesh.

The observations and consequent recommendation highlighted by EY will assist the government departments in institutionalizing controls and strengthening program fiduciary controls. The recommendations assisted in capacity building of the staff of the government departments which will lead to better financial management, improved quality of works and strengthen the procurement function.

EY conducted two Dissemination Workshops covering more than 250 government employees from across Bangladesh for dissemination of recommendations and institutional strengthening of government offices involved.

The Government is developing interventions for future years taking due consideration of the recommendations made by EY based on our findings at the ground level.

The assignment also helped the development partners to improve oversight over the activities and controls of the project.

EY’s Public Financial Management (PFM) Services focuses on the governments and clients in improving financial efficiency and effectiveness of their services and operations. Our comprehensive end-to-end approach is based on institutional diagnostics, processes, procedural and design adjustments, and context driven by the technical PFM systems deployment. EY is investing in the Public Financial Management agenda to ensure we can most effectively support governments and international financial institutions. For more details contact:

Sanjoy K Gupta Partner- Advisory Services, EY Tel: +9133 66153514 Email: sanjoy.k.gupta@in.ey.com

Has Integrated Newsroom come of age?

Latest Thinking

Connect with usSocial media Our social media channels help you to stay up to date on our reports, studies, recruiting events and more. You can find us on Facebook, LinkedIn, Twitter and YouTube. Follow us on Twitter @EY_India

Citizen Today

Budget Connect 2016

The DNA of the CFO

Public-private partnerships and global infrastructure

Our officesAhmedabad2nd floor, Shivalik Ishaan Near C.N. VidhyalayaAmbawadiAhmedabad - 380 015Tel: + 91 79 6608 3800Fax: + 91 79 6608 3900

Bengaluru12th & 13th floor“UB City”, Canberra BlockNo.24 Vittal Mallya RoadBengaluru - 560 001Tel: + 91 80 4027 5000 + 91 80 6727 5000 Fax: + 91 80 2210 6000 (12th floor)Fax: + 91 80 2224 0695 (13th floor)

Ground Floor, ‘A’ wingDivyasree Chambers # 11, O’Shaughnessy RoadLangford Gardens Bengaluru - 560 025Tel: +91 80 6727 5000Fax: +91 80 2222 9914

Chandigarh1st Floor, SCO: 166-167Sector 9-C, Madhya MargChandigarh - 160 009 Tel: + 91 172 671 7800Fax: + 91 172 671 7888

ChennaiTidel Park, 6th & 7th Floor A Block (Module 601,701-702)No.4, Rajiv Gandhi Salai Taramani, Chennai - 600 113Tel: + 91 44 6654 8100 Fax: + 91 44 2254 0120

Delhi NCRGolf View Corporate Tower BNear DLF Golf CourseSector 42Gurgaon - 122 002Tel: + 91 124 464 4000Fax: + 91 124 464 4050

3rd & 6th Floor, Worldmark-1IGI Airport Hospitality DistrictAerocity New Delhi - 110 037Tel: +91 11 6671 8000 Fax +91 11 6671 9999

4th & 5th Floor, Plot No 2B Tower 2, Sector 126 NOIDA - 201 304 Gautam Budh Nagar, U.P.Tel: + 91 120 671 7000 Fax: + 91 120 671 7171

HyderabadOval Office, 18, iLabs CentreHitech City, MadhapurHyderabad - 500 081Tel: + 91 40 6736 2000Fax: + 91 40 6736 2200

Jamshedpur1st Floor, Shantiniketan Building Holding No. 1, SB Shop Area Bistupur, Jamshedpur – 831 001Tel: + 91 657 663 1000

Kochi9th Floor, ABAD NucleusNH-49, Maradu POKochi - 682 304Tel: + 91 484 304 4000 Fax: + 91 484 270 5393

Kolkata22 Camac Street3rd floor, Block ‘C’Kolkata - 700 016Tel: + 91 33 6615 3400Fax: + 91 33 2281 7750

Mumbai14th Floor, The Ruby29 Senapati Bapat MargDadar (W), Mumbai - 400 028Tel: + 91 022 6192 0000Fax: + 91 022 6192 1000

5th Floor, Block B-2Nirlon Knowledge ParkOff. Western Express HighwayGoregaon (E)Mumbai - 400 063Tel: + 91 22 6192 0000Fax: + 91 22 6192 3000

PuneC-401, 4th floor Panchshil Tech ParkYerwada (Near Don Bosco School)Pune - 411 006Tel: + 91 20 6603 6000Fax: + 91 20 6601 5900

Ernst & Young LLPEY | Assurance | Tax | Transactions | Advisory

About EYEY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.

EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com.

Ernst & Young LLP is one of the Indian client serving member firms of EYGM Limited. For more information about our organization, please visit www.ey.com/in.

Ernst & Young LLP is a Limited Liability Partnership, registered under the Limited Liability Partnership Act, 2008 in India, having its registered office at 22 Camac Street, 3rd Floor, Block C, Kolkata - 700016

© 2016 Ernst & Young LLP. Published in India. All Rights Reserved.

EYIN1610-098

ED None

This publication contains information in summary form and is therefore intended for general guidance only. It is not intended to be a substitute for detailed research or the exercise of professional judgment. Neither Ernst & Young LLP nor any other member of the global Ernst & Young organization can accept any responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this publication. On any specific matter, reference should be made to the appropriate advisor.